Strange problem. I can't delete mail in Outlook Express 6. I've tried copying the Inbox to a new folder and then deleting the inbox. (Outlook will re-create a new Inbox on restart) On restart, I copy the mail from the new folder to the new Inbox; no dice.

While in the INBOX - what happens when you right click a message and hit delete?

What happens when you drag the message to the DELETED ITEMS folder in the folder panel?

When you moved your INBOX folder and OE created a new one.... before you moved the old contents back - was the new one empty? Did you try sending yourself mail to that new empty folder and then seeing if you could delete it? I would check that out incase there is something corrupting the contents of the old folder.